Tamawood Ltd v Habitare Developments Pty Ltd
[2015] FCAFC 65
•18 May 2015
FEDERAL COURT OF AUSTRALIA
Tamawood Limited v Habitare Developments Pty Ltd (Administrators Appointed) (Receivers and Managers Appointed) [2015] FCAFC 65
Citation: Tamawood Limited v Habitare Developments Pty Ltd (Administrators Appointed) (Receivers and Managers Appointed) [2015] FCAFC 65 Appeal from: Tamawood Ltd v Habitare Developments Pty Ltd (Administrators Appointed) (Receivers and Managers Appointed) (No 3) [2013] FCA 410
Tamawood Ltd v Habitare Developments Pty Ltd (Administrators Appointed) (Receivers and Managers Appointed) (No 6) [2013] FCA 1383
Parties: TAMAWOOD LIMITED ACN 010 954 499 v HABITARE DEVELOPMENTS PTY LTD (ADMINISTRATORS APPOINTED) (RECEIVERS AND MANAGERS APPOINTED) ACN 122 935 497, BLOOMER CONSTRUCTIONS (QLD) PTY LTD ACN 071 344 100, PETER FREDERICK O'MARA, DAVID GAVIN JOHNSON, WAYNE NORMAN BLOOMER and MONDO ARCHITECTS PTY LTD ACN 085 992 990
MONDO ARCHITECTS PTY LTD ACN 085 992 990 v TAMAWOOD LIMITED ACN 010 954 499
SHANE ANDREW O’MARA v TAMAWOOD LIMITED ACN 010 954 499, MONDO ARCHITECTS PTY LTD ACN 085 992 990, RAYMOND JOHN MCDONALD SWEENEY
File numbers: QUD 223 of 2014
QUD 235 of 2014
QUD 240 of 2014Judges: GREENWOOD, JAGOT AND MURPHY JJ Date of judgment: 18 May 2015 Catchwords: COPYRIGHT – whether contractual licence created – whether infringement of copyright occurred – whether defence of indirect copying available – whether defence of innocent infringement under s 115(3) of Copyright Act 1968 (Cth) available – whether there was an authorisation of infringement – whether additional damages available under s 115(4) of Copyright Act 1968 (Cth)
TRADE PRACTICES – whether misleading conduct under s 72B of the Trade Practices Act 1974 (Cth)
COSTS – costs order set aside
Legislation: Copyright Act 1968 (Cth) ss 36(1),(1A), 115(3),(4)
Trade Practices Act 1974 (Cth) s 75BCases cited: Aristocrat Technologies v DAP Services (2007) 157 FCR 64
Blatch v Archer (1774) 1 Cowp 63; (1774) 98 ER 969
BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266 at 283
Concrete Pty Ltd v Parramatta Design & Developments Pty Ltd (2006) 229 CLR 577; [2006] HCA 55
Cooper v Universal Music Australia Pty Ltd (2006) 156 FCR 380
Devries v Australian National Railways Commission (1993) 177 CLR 472
Eagle Homes Pty Ltd v Austec Homes Pty Ltd (1999) 87 FCR 415; [1999] FCA 138
Expectation Pty Ltd v PRD Realty Pty Ltd (2004) 140 FCR 17; [2004] FCAFC 189
Fox v Percy (2003) 214 CLR 118
Francis Day & Hunter Ltd. v. Bron [[1963] Ch. 587
Futuretronics.com.au Pty Limited v Graphix Labels Pty Ltd(No 2) (2008) 76 IPR 763; [2008] FCA 746
Golden Editions Pty Ltd v Polygram Pty Ltd (1996) 61 FCR 479
Hadid v Redpath (2001) 35 MVR 152
Hanfstaengl v Baines & Co [1895] AC 20
House v The King (1936) 55 CLR 499
Krueger Transport Equipment Pty Ltd v Glen Cameron Storage & Distribution Pty Ltd (No 2) [2008] FCA 1493
Ladbroke (Football) Ltd. v. William Hill (Football) Ltd [[1964] 1 W.L.R. 273, at p. 276; [1964] 1 All E.R. 465
LED Builders Pty Ltd v Eagle Homes Pty Ltd (1996) 35 IPR 215
Milwell Pty Ltd v Olympic Amusements Pty Ltd (1999) 85 FCR 436
R v Maxwell (unreported, New South Wales Court of Criminal Appeal, Spigelman CJ, Sperling and Hidden JJ, 23 December 1998)
Raben Footwear Pty Ltd v Polygram Records Inc (1997) 75 FCR 88
Ravenscroft v Herbert and New English Library Limited [1980] RPC 193
Ron Englehart Pty Ltd v Enterprise Constructions (Aust) Pty Ltd (2012) 95 IPR 64; [2012] FCAFC 4
SW Hart & Co Pty Ltd v Edwards Hot Water Systems (1985) 159 CLR 466
Tamawood Ltd v Habitare Developments Pty Ltd (Administrators Appointed) (Receivers and Managers Appointed) (No 3) (2013) 101 IPR 225; [2013] FCA 410
Tamawood Ltd v Habitare Developments Pty Ltd (Administrators Appointed) (Receivers and Managers Appointed) (No 6) [2013] FCA 1383
Tamawood Ltd v Habitare Developments Pty Ltd (Administrators Appointed) (Receivers and Managers Appointed) (No 4) [2013] FCA 1047
Tamawood Ltd v Henley Arch Pty Ltd [(2004) 61 IPR 378; [2004] FCAFC 78
University of New South Wales v Moorhouse (1975) 133 CLR 1Date of hearing: 10 -12 November 2014 Place: Sydney via video-link to Brisbane Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 232 Counsel for Tamawood Limited: R Cobden SC and R Alkadamani Solicitor for Tamawood Limited: Castrission & Co Counsel for Mondo Architects: S Couper QC and A Musgrave Solicitor for Mondo Architects: Barry Nilsson Lawyers Counsel for the Appellant in QUD 240 of 2014 and the Third Respondent in QUD 223 of 2014: N Ferrett Solicitor for the Appellant in QUD 240 of 2014 and the Third Respondent in QUD 223 of 2014: B2B Lawyers Counsel for the Second and Fifth Respondents in QUD 223 of 2014: T Matthews QC and M Drysdale Solicitor for the Second and Fifth Respondents in QUD 223 of 2014: Romans & Romans Lawyers
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
QUD 223 of 2014
ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA
BETWEEN: TAMAWOOD LIMITED ACN 010 954 499
AppellantAND: HABITARE DEVELOPMENTS PTY LTD (ADMINISTRATORS APPOINTED) (RECEIVERS AND MANAGERS APPOINTED) ACN 122 935 497
First RespondentBLOOMER CONSTRUCTIONS (QLD) PTY LTD
ACN 071 344 100
Second RespondentPETER FREDERICK O'MARA
Third RespondentDAVID GAVIN JOHNSON
Fourth RespondentWAYNE NORMAN BLOOMER
Fifth RespondentMONDO ARCHITECTS PTY LTD ACN 085 992 990
Sixth Respondent
JUDGES:
GREENWOOD, JAGOT AND MURPHY JJ
DATE OF ORDER:
18 MAY 2015
WHERE MADE:
SYDNEY VIA VIDEO-LINK TO BRISBANE
THE COURT ORDERS THAT:
1.The parties confer and submit within 14 days agreed or competing proposed orders which reflect the reasons for judgment published today.
Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
QUD 235 of 2014
ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA
BETWEEN: MONDO ARCHITECTS PTY LTD ACN 085 992 990
Appellant
AND: TAMAWOOD LIMITED ACN 010 954 499
Respondent
JUDGES:
GREENWOOD, JAGOT AND MURPHY JJ
DATE OF ORDER:
18 MAY 2015
WHERE MADE:
SYDNEY VIA VIDEO-LINK TO BRISBANE
THE COURT ORDERS THAT:
1.The parties confer and submit within 14 days agreed or competing proposed orders which reflect the reasons for judgment published today.
Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
QUD 240 of 2014
ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA
BETWEEN: SHANE ANDREW O’MARA
AppellantAND: TAMAWOOD LIMITED ACN 010 954 499
First RespondentMONDO ARCHITECTS PTY LTD ACN 085 992 990
Second RespondentRAYMOND JOHN MCDONALD SWEENEY
Third Respondent
JUDGES:
GREENWOOD, JAGOT AND MURPHY JJ
DATE OF ORDER:
18 MAY 2015
WHERE MADE:
SYDNEY VIA VIDEO-LINK TO BRISBANE
THE COURT ORDERS THAT:
1.The parties confer and submit within 14 days agreed or competing proposed orders which reflect the reasons for judgment published today.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
QUD 223 of 2014
ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA
BETWEEN: TAMAWOOD LIMITED ACN 010 954 499
AppellantAND: HABITARE DEVELOPMENTS PTY LTD (ADMINISTRATORS APPOINTED) (RECEIVERS AND MANAGERS APPOINTED) ACN 122 935 497
First RespondentBLOOMER CONSTRUCTIONS (QLD) PTY LTD
ACN 071 344 100
Second RespondentPETER FREDERICK O'MARA
Third RespondentDAVID GAVIN JOHNSON
Fourth RespondentWAYNE NORMAN BLOOMER
Fifth RespondentMONDO ARCHITECTS PTY LTD ACN 085 992 990
Sixth Respondent
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
QUD 235 of 2014
ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA
BETWEEN: MONDO ARCHITECTS PTY LTD ACN 085 992 990
Appellant
AND: TAMAWOOD LIMITED ACN 010 954 499
Respondent
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
QUD 240 of 2014
ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA
BETWEEN: SHANE ANDREW O’MARA
AppellantAND: TAMAWOOD LIMITED ACN 010 954 499
First RespondentMONDO ARCHITECTS PTY LTD ACN 085 992 990
Second RespondentRAYMOND JOHN MCDONALD SWEENEY
Third Respondent
JUDGES:
GREENWOOD, JAGOT AND MURPHY JJ
DATE:
18 MAY 2015
PLACE:
SYDNEY VIA VIDEO-LINK TO BRISBANE
REASONS FOR JUDGMENT
GREENWOOD J:
These proceedings are concerned with three appeals (and related notices of contention) arising out of a judgment in this Court in proceedings in which the appellant in the first appeal, Tamawood Limited (“Tamawood”), claimed, put simply and relevantly for present purposes, relief against a developer, Habitare Developments Pty Ltd (“Habitare”), and its related entities, Habitare’s architects, Mondo Architects Pty Ltd (“Mondo”), and Habitare’s builder, Bloomer Constructions (Qld) Pty Ltd (“Bloomer”), arising out of contended infringements (and authorisations of those infringements) of Tamawood’s copyright subsisting in plans for particular project homes described as the Torrington and the Conondale/Dunkeld (which I will call the “Dunkeld”) by two‑dimensional and three‑dimensional reproduction of the copyright works.
Relief was also claimed in the principal proceeding against a number of individuals: Mr Peter O’Mara, a director of Habitare; Mr David Johnson, another director of Habitare (although Mr Johnson’s trustee in bankruptcy did not appear in the principal proceedings to resist Tamawood’s claims against Mr Johnson); and Mr Wayne Bloomer, a director of Bloomer. Apart from Tamawood’s original proceedings, Mondo brought proceedings against Habitare, Mr Peter Speer who worked for Habitare, and Mr Shane O’Mara (Mr Peter O’Mara’s son) who also worked for Habitare, for contended contraventions of the Trade Practices Act 1974 (Cth) which, of course, is now the Competition and Consumer Act 2010 (Cth).
I have had the benefit of reading in draft the joint reasons for judgment of Jagot and Murphy JJ. In those reasons, their Honours set out in more precise detail the various parties to the primary proceedings and the nine issues agitated before the Full Court in respect of the three appeals and the notices of contention. I set out those nine issues and my position on each issue at [92] to [100] of these reasons.
In these reasons, I propose to address the question of whether Tamawood’s copyright in the plan for the Conondale/Dunkeld duplex was infringed in the way contended for by Tamawood on appeal.
A short synopsis of the background facts (particular aspects of which will need to be examined in a little detail) is, for present purposes, this. Tamawood is a company which produces plans for low cost project housing in Australia which it uses for building dwellings on relevant sites. Habitare was at all relevant times a company involved in the construction of “low‑cost, intensive housing projects in Brisbane”: Tamawood Limited v Habitare Developments Pty Ltd (Administrators Appointed) (Receivers and Managers Appointed) (No 3) [2013] FCA 410 (the “primary judgment”) at [7]. In 2005, Habitare (through related entities continued reference to which is no longer relevant), engaged in discussions with Tamawood with a view to Tamawood producing plans for low cost housing to be built by Tamawood for Habitare at two sites described as Hamish Street, Calamvale in Brisbane and Gawler Street/Norris Road, Brackenridge in Brisbane.
Plans relating to the two sites were produced by Tamawood for a single‑storey duplex called the Dunkeld, and a two‑storey duplex called the Torrington. Habitare then lodged applications with the Brisbane City Council so as to obtain development approval for a housing development on each site. Habitare, with Tamawood’s agreement, lodged Tamawood’s plans for the Torrington and the Dunkeld with the Brisbane City Council as part of the development approval application. The Brisbane City Council issued a development approval for the Hamish Street development on 7 July 2006. Condition 1 of the development approval was, relevantly, in these terms:
Carry out the approved development generally in accordance with the approved drawing(s) and/or document/s.
GUIDELINE
The condition refers to the approved plans, drawings and documents to which the approval relates and is the primary means of defining the extent of the approval. Approved Plans, drawings and Documents are stamped referred to in the Approval and are dated to reflect the date of approval by the Council’s Delegate.
The Brisbane City Council issued a development approval for the Gawler Street/Norris Road development on 1 March 2006. Condition 1 of the approval is in the same terms as Condition 1 quoted at [6] of these reasons.
Habitare and Tamawood were ultimately unable to agree upon the terms and conditions of a commercial engagement under which Tamawood would build houses based on its plans on each site for Habitare. Habitare did not use Tamawood to construct dwellings on either site. In order to develop plans for dwellings to be built on each site, Habitare approached Mondo to develop house plans for construction on each site. In order to comply with Condition 1 of each development approval, the dwellings to be constructed on each site were required to be “generally in accordance with the approved drawing(s) and/or document/s”. The approved drawings were the Tamawood plans. Mondo prepared plans for dwellings for each site to enable building certificates to be obtained for construction. Those building certificates were obtained by Habitare based on the Mondo plans. Habitare ultimately engaged Bloomer to construct or complete construction of dwellings on each site. Structures reflecting a three‑dimensional reproduction of the Mondo plans were erected on each site.
Although the plans for dwellings on each site were required to be generally in accordance with the approved drawings (and thus Tamawood’s drawings for Torrington and Dunkeld), Mr Raymond Sweeney, a director of Mondo, gave evidence before the primary judge in an affidavit sworn 20 September 2011, that the parameters of the development approval included such things as the gross floor area; the size, shape and height of the dwellings; the number of dwellings; the distances between dwellings; and the distances between the dwellings and the boundaries. Mr Sweeney also gave evidence that based on his experience as an architect, the internal design of the dwellings is not “evaluated” or taken into account by the Brisbane City Council in the development assessment process except where it creates an impact on one of the assessment parameters. At [200], the primary judge notes the evidence of Mr Scott Richards (set out in an expert report) to the effect that amendments which can be considered as “generally in accordance with” an approved development (for the purposes of the Integrated Planning Act 1997 (Qld)) relate to:
… less substantial matters that have no bearing on town planning generally and no impact on town planning criteria or development assessment matters (para 4.2.14). Materially, Mr Richards opines further that such amendments can include amendments to internal layouts, such as removal of walls and rearrangement of rooms, but that more substantial amendments proposed to an approved development would require lodgement of a new development application (para 4.2.14 and para 4.2.27).
[emphasis added]At [201], the primary judge observes, however, that Mondo was under some pressure to produce documents which “generally accorded” with the plans of Tamawood which had already received development approval.
Arising out of these events, Tamawood contended that the Mondo plans for the single‑storey and two‑storey duplexes infringed its copyright in the Dunkeld and Torrington plans respectively with the result that the two‑dimensional drawings and the three‑dimensional structures on the sites were reproductions in a material form of Tamawood’s copyright works in each case. As mentioned, Tamawood maintained proceedings against the developer (Habitare), the builder (Bloomer), Mr Bloomer, the directors of Habitare (Mr Peter O’Mara and Mr Johnson) and Mondo.
In the result, the primary judge ultimately made a number of declarations on 7 May 2014 arising out of the trial of the action and the reasons for judgment published on 7 May 2013. The relevant declarations were these:
2.… in making [the two‑storey] drawings for the purposes of the Habitare developments at the Calamvale and Brackenridge sites, Mondo infringed [Tamawood’s] copyright in the Torrington drawings.
3.… in building dwellings at the Calamvale and Brackenridge sites in accordance with Mondo’s [two‑storey] drawings, the Habitare Respondents infringed [Tamawood’s] copyright in the Torrington drawings.
4.… the Habitare Respondents authorised Mondo’s infringement of [Tamawood’s] copyright in the Torrington drawings …
5.… the Habitare Respondents authorised Bloomer Constructions’ innocent infringement of [Tamawood’s] copyright in the Torrington drawings in providing to Bloomer Constructions the [two‑storey] drawings created by Mondo for use in the construction of dwellings at [the] Calamvale and Brackenridge sites.
6.… the Habitare Respondents engaged in a common design to infringe [Tamawood’s] copyright [in the Torrington drawings].
7.… [Tamawood] is not entitled to any additional damages pursuant to section 115(4) of the Copyright Act.
Apart from these declarations, the primary judge granted two injunctions and made costs orders. In the orders made on 7 May 2014, the “Habitare Respondents” are defined to mean Habitare and three Habitare entities no longer relevant for present purposes. As appears from the declarations, the primary judge found for Tamawood in respect of the Torrington two‑storey plan but not the single‑storey Dunkeld plan. The primary judge rejected Habitare’s contention (and that of Mr Shane O’Mara) that Tamawood had conferred upon Habitare and Mondo a licence (contractual or non‑contractual) for the purposes of s 36(1) of the Copyright Act 1968 (Cth) (the “Act”) to exercise the reproduction right in s 31(1) of the Act in Tamawood’s plans. The primary judge also dismissed Tamawood’s claims against the directors of Habitare, Mr Peter O’Mara and Mr Johnson for authorisation of Habitare’s infringement of Tamawood’s copyright in the Torrington plans. As reflected in the declarations, the primary judge found that Tamawood was not entitled to any additional damages pursuant to s 115(4) of the Act as against Habitare or the directors of Habitare or Mondo in respect of conduct in connection with the Torrington plans. The primary judge also made declarations on 26 November 2013 in these terms:
1.In building dwellings at the Calamvale and Brackenridge sites in accordance with Mondo’s [two‑storey] drawings, Bloomer Constructions innocently infringed [Tamawood’s] copyright in the Torrington drawings.
2.Wayne Norman Bloomer authorised Bloomer Constructions’ innocent infringement of the applicant’s copyright in the Torrington drawings referred to in the preceding order.
3.In respect of the infringements of [Tamawood’s] copyright by Bloomer Constructions and Wayne Norman Bloomer those respondents made out a defence under s 115(3) of the [Act], commonly known as “innocent infringement”.
In the Mondo proceedings, the primary judge found contraventions of s 52 of the Trade Practices Act 1974 (Cth) by Habitare and found that Mr Speer and Mr Shane O’Mara were knowingly concerned in Habitare’s contraventions and thus also liable to Mondo in respect of those contraventions by Habitare.
In their draft reasons for judgment, Jagot and Murphy JJ identify nine issues that arise on these appeals (and the notices of contention) for determination. I agree that these proceedings before the Full Court raise those nine issues and I will not repeat at this point in these reasons a list of each separate question. Apart from later setting out my position on each of the nine issues before the Full Court, the principal question I propose to address in these reasons is this: If Tamawood is not precluded by reason of the pleadings in the proceeding and the way in which the case was conducted before the primary judge from arguing that an inference of indirect copying by Mondo should be drawn, did the primary judge err in finding that Mondo did not infringe Tamawood’s copyright in the Dunkeld plan?: Issue 3 before the Full Court.
I should immediately say that I agree with the observations of Jagot and Murphy JJ that Tamawood is not precluded, by reason of the pleadings or the conduct of the case before the primary judge, from arguing that an inference of indirect copying by Mondo should be drawn. The question then is whether having regard to all the relevant circumstances such an inference should be drawn. For my part, I respectfully disagree with the views of Jagot and Murphy JJ on that question. In my view, Mondo’s Duplex 1 plan does not infringe the copyright subsisting in Tamawood’s Dunkeld plan for the reasons set out in these reasons.
In the course of the appeal, counsel for Tamawood handed up to the members of the Court (with copies to the parties) two enlarged plans which frame, at least so far as the plans are concerned apart from other contextual issues, the question of whether Mondo’s plan for a single‑storey duplex (Duplex 1) is a reproduction in a material form of Tamawood’s Dunkeld plan. The plan in suit is called the Dunkeld plan but that plan is sometimes known as “Stad 939” and also Conondale/Dunkeld. Each enlarged plan is a plan for a single‑storey duplex. Each plan contains a layout for such a duplex on each side of a concrete block common wall and thus the floor plan for the right‑hand side of that common wall is a mirror image of the plan for the left‑hand side of the common wall. It is therefore only necessary to have regard to the plan for the left‑hand side of the duplex in each case. In the reasons for judgment of the primary judge, there are many A4 reproductions of plans which are very difficult to read. Similarly, annexed A4 plans to affidavits are difficult to read. No doubt for this reason, counsel for Tamawood delivered up an enlargement of the two immediately relevant plans in suit on this issue. Accordingly, I have incorporated within these reasons the plan for the left‑hand side of each of the enlarged plans as delivered up by counsel for Tamawood. The first plan set out below is Tamawood’s copyright work in suit labelled “Stad 939/Conondale/Dunkeld” and the second plan set out below is Mondo’s plan for its Duplex 1:
Stad 939 Conondale/Dunkeld
Mondo’s Duplex 1
I will return to each of these plans later in these reasons.
Some relevant principles
In S W Hart & Co Pty Ltd v Edwards Hot Water Systems (1985) 159 CLR 466 at 472, Gibbs CJ observed (with Mason J agreeing at 478 and Brennan J agreeing at 491) that the notion of reproduction for the purposes of copyright law involves two elements: resemblance to, and actual use of the copyright work, or put another way, a “sufficient degree” of objective similarity between the two works in suit and “some causal connection” between, in this case, Tamawood’s Dunkeld plan and Mondo’s plan. The Chief Justice then adopted at 472 the observations of Lord Reid in Ladbroke (Football) Ltd v William Hill (Football) Ltd [1964] 1 W.L.R. 273 at 276 that “[b]roadly, reproduction means copying, and does not include cases where an author or compiler produces a substantially similar result by independent work without copying” [emphasis added]. These two issues of a “sufficient degree of objective similarity” between the two works and “some causal connection” between them are discrete yet overlapping issues.
The issues are discrete in the sense that in the absence of some causal connection, objective similarity (or for that matter a high degree of reconciliation) between the two works does not give rise to reproduction for the reasons Lord Reid identifies. They overlap, however, because an assertion of a causal connection between the claimant’s work and that of the contended infringer is often made on the footing that an inference of access to and use of the claimant’s work (in the absence of an admission) ought to be drawn because of, generally, a high degree of similarity or striking similarity between the two works (coupled with opportunity (access)) and often also coupled with a failure by the contended infringer to adequately explain that party’s assertions of independent origination (authorship) of the work said to infringe: an analysis sometimes called “probative similarity” (Eagle Homes Pty Ltd v Austec Homes Pty Ltd (“Eagle Homes v Austec”), (1999) 87 FCR 415, Lindgren J at [84], Finkelstein J agreeing at [111].
The issues are also discrete in the sense that once the issue of a causal connection is made good (absent an admission) by reason of an inference drawn based upon the degree of similarity (relevant in the particular case) between the two works, a further question must nevertheless be addressed of whether there is a “sufficient degree” of objective similarity so as to amount to reproduction of the copyright work in suit: sometimes called the “second limb” or more commonly “substantial similarity” (Eagle Homes v Austec at [85]).
Care needs to be taken with the use of the “rolled up” term “copying”. Generally, when the term “copying” is used in the authorities, the term is used in the context of the making of a finding of fact of whether a causal nexus has been made good between the two works. That is to say, use of the copyright work consciously or unconsciously “although it must be said that in the case of works such as architectural plans it would be surprising to find many cases of unconscious copying”: Clarendon Homes (Aust) Pty Ltd v Henley Arch Pty Ltd (“Clarendon v Henley Arch”) (1999) 46 IPR 309, Heerey, Sundberg and Finkelstein JJ at [24].
Once the causal link is made good a further question is whether the whole or a substantial part of the copyright work has been reproduced.
In Clarendon v Henley Arch, the Full Court said this at [27]:
The question whether, in the absence of an admission, copying (that is a causal nexus between the plaintiff’s work and the defendant’s work) is established is not the same as the question whether, once copying has been established, the whole or a substantial part of the plaintiff’s work has been appropriated. We accept that very often the two issues will overlap. But nevertheless they are discrete issues and the answer to one does not necessarily produce an answer to the other. For example, in order to prove that there has been a copying it is usual to attempt to show opportunity, that is access to the plaintiff’s work, and such similarities between the plaintiff’s work and the defendant’s work as makes independent creation by the defendant unlikely. Such similarities may or may not be substantial. They can include common error, sometimes deliberately inserted in the plaintiff’s work. Paradoxically, there will be occasions where dissimilarities may provide the basis for an inference of access and copying.
[emphasis added]See also Tamawood Limited v Henley Arch Pty Ltd (2004) 61 IPR 378, Wilcox and Lindgren JJ at [44]; Pacific Gaming Pty Ltd v Aristocrat Leisure Industries Pty Ltd (“Pacific Gaming v Aristocrat”) (2001) 116 FCR 448, Sackville, Finn and Kenny JJ at [19].
Whether a causal link is made good is a question of fact.
To the extent that proof of a causal link rests upon an inference drawn from primary facts of access, opportunity and objective similarities between the relevant works, the objective similarities would normally need to be “sufficiently great” (Pacific Gaming v Aristocrat at [19]) or in the case of project home plans “[i]t is understandable that in such cases of project home plans there will be an emphasis on the need for close similarity if infringement [an observation made in the context of probative similarity or causal link] is to be proved”: Eagle Homes v Austec at [84].
However, the two elements of causal link and sufficient objective similarity “are but aspects of ‘reproduction’” and it can be “artificial to consider them separately … where actual copying [access to and use of the copyright work] is found to have occurred”: Eagle Homes v Austec at [98]. That follows because a finding of copying “can add significance to objective similarity”: Eagle Homes v Austec at [98].
It should also be remembered that the notion of reproduction of a work in a material form (s 31(1)(a)(i) of the Act) includes a reference to reproduction of a substantial part of the work (s 14(1) of the Act) and thus the greater includes the lesser in the sense that the Act recognises a distinction between the “undifferentiated whole of a copyright work” (for example, a floor plan for a project home) and a substantial part of the undifferentiated whole of that work: see Eagle Homes v Austec at [70]. Thus, the copyright owner might seek to establish reproduction by showing “a sufficient degree of objective similarity” in the undifferentiated whole of the plan, or alternatively, by showing a substantial part of the work has been reproduced, or both.
Where the issue is whether the undifferentiated whole of the copyright work has been reproduced (rather than the isolation of a particular part of the work and then an examination of the quantitative and qualitative aspects of the part said to be taken), the question to be determined in circumstances where the copyright work is not precisely or exactly taken, is how closely must the impugned work resemble the copyright work before reproduction is made out. The answer, put generally, is that “a sufficient degree of objective similarity” in the circumstances of each case must be proved. The sufficiency of that degree is, however, influenced by the overlapping nature of the otherwise discrete questions.
In Eagle Homes v Austec, Lindgren J at [85] (Finkelstein J agreeing at [111]), in the context of a finding of actual copying (that is, opportunity, access and probative similarity) found error in reasoning to the following effect: because project home plans are simple drawings of the “commonplace”, lack “marked originality” and can be expected to have some similarities (as project home plans share certain features), it follows that sufficient objective similarity could not exist in the absence of a very close resemblance between the two project house plans. Lindgren J regarded that reasoning as flawed which led his Honour to also observe, in the context of a causal link made good by subjective copying, as follows at [86]:
It is reasonable, therefore, to think that copyright law is concerned to protect against subjective copying and that where subjective copying occurs there can be expected to be found an infringement, unless it transpires that the product is so dissimilar to the copyright work that the copyright work can no longer be seen in the work produced.
[emphasis added]And at [91], Lindgren J also observed:
In no case concerning project homes of which I am aware where there has been such a finding of actual copying, has it been held that nonetheless the copier will not have infringed copyright unless there is in addition an extraordinarily close resemblance between his or her drawing and the copyright work. Rather, I think that the issue of sufficient objective similarity simply poses in the case of project homes, as in other cases, the usual question whether the copyright drawing can still be seen embedded in the allegedly infringing drawing, that is, whether the allegedly infringing drawing has adopted the “essential features and substance” of the copyright work: Hanfstaengl v Baines & Co [1895] AC 20 at 31 (Lord Shand) …
[emphasis added]
Thus, the Full Court regarded the issue, in the case of project home plans, of whether sufficient objective similarity exists as simply raising the usual question which is: Can the copyright drawing still be seen embedded in the impugned drawing or, put another way: has the impugned drawing adopted the essential features and substance of the copyright work?
Thus, the notion that there must be, in the case of plans for project homes, an extraordinarily close resemblance between the copyright work and the impugned work is “too stringent” a test for determining a sufficient degree of objective similarity so as to amount to reproduction. In expressing the test in the way described, Lindgren J for the Full Court was seeking to demonstrate that the near absolutism of exact reproduction (as a test) reflected in the reasoning of the primary judge (in that case) of the need for “extraordinarily close resemblance” as the measure of a sufficient degree of objective similarity (in a case of proven copying) unnecessarily goes beyond, as a matter of principle, the statutory concept of reproduction as explained in the authorities.
His Honour’s adoption of terms of emphasis such as embedded in, essential features and substance of the work, simply reflect the notion that what is required in cases involving plans for project homes (like any other copyright work) is a sufficient degree of objective similarity in the particular circumstances of the particular case measured by reference to the essential features and substance of the copyright work in suit as expressed in the form of the floor plan (in this case) and the form of expression of the impugned plan by the contended infringer.
Three other things should be mentioned.
First, where reproduction is sought to be made good by reference to objective similarities in the undifferentiated whole of Tamawood’s Dunkeld plan, and Mondo’s Duplex 1 plan (should a causal link be made good) reproduction (that is, a sufficient degree of objective similarity) might find expression, in part, in the “layout and traffic flows and the shapes, proportions and interrelationships of the rooms and other spaces – elements which permeate the whole of the project home”: Eagle Homes v Austec at [74].
Second, where the contended infringer has not reproduced the precise or exact expression of the copyright work, and a sufficient degree of objective similarity between two works is sought to be made out by reference to elements such as those described at [37] of these reasons, questions will arise of whether, simply, ideas reflected in the copyright work have been engaged with, adopted and used resulting in the expression of the contended infringer’s plan or whether the very expression of the copyright work has been reproduced due to the sufficiency of the degree of objective similarity between the two works.
It is in this sense that causal connection and objective similarity also overlap yet remain discrete questions to be addressed.
Third, in Eagle Homes v Austec, Lindgren J (Finkelstein J agreeing) said that where subjective copying occurs an expectation of a finding of infringement arises (that is, an expected finding of a sufficient degree of objective similarity arises) unless the contended infringing work is so dissimilar to the copyright work that that work can no longer be seen in the impugned work. Reproduction is made out by an applicant when a sufficient degree of objective similarity is made good and the contended infringer has made actual use of the copyright work either directly or through an intermediary instructor. Actual use of the copyright work will necessarily “add significance” (see [28] of these reasons) to a finding of sufficiency of objective similarity, as will a finding of attempted obfuscation by a putative infringer of his or her use of the copyright work in bringing the impugned work into existence.
If the reference to so dissimilar that the copyright work can no longer be seen in the impugned work simply means (as it seems to me it does so mean) that the requirement of a sufficient degree of objective similarity is satisfied (in circumstances of subjective copying) when the essential features of the copyright work can still be seen in the impugned work (either as a whole or as to a substantial part), I would agree that such a formulation is an accurate statement of the test for reproduction, informed as it is, by subjective copying. If, however, Lindgren J’s formulation of the test (in the circumstances his Honour identifies) assumes an expected starting point of sufficiency of objective similarity unless the impugned work is so dissimilar that there is no element of similarity between the two works, such a test does not accurately reflect, in my view, the proper test and ought not to be adopted for determining whether the Duplex 1 plan bears a sufficient degree of objective similarity to the Dunkeld plan. For one thing, the notion that the copyright work can “be seen” in the contended infringing work or that one can look through the infringing work, like a milky window, and see the copyright work in the contended infringing work, might simply mean that one can see the ideas contained within the copyright work in the infringing work. There is nothing unlawful in using the ideas in one work as the foundation for the expression of one’s own work expressed by reason of the work, skill, effort and judgement of the author of the contended infringing work.
The appeal
At this point, it is necessary to say something about the methodological approach adopted by the primary judge to determining infringement.
I am satisfied, respectfully, that the primary judge fell into error by adopting an approach characterised by Lindgren J in Eagle Homes v Austec as “artificial” (see [28] of these reasons) of almost entirely separately considering first, whether reproduction of the Tamawood plans in suit had been made out (by reason of whether a sufficient degree of objective similarity was evident as between the relevant plans) and then considering as an entirely independent question whether a causal connection had also been made out.
If there is any sequence as such to the inquiry to be made (recognising, however, that no answer to a particular question in the sequence forecloses asking the other questions as each question overlaps with the other) it is probably this. Logically, the first question (in the absence of an admission) is whether initially there appears to be a sufficient degree of resemblance between Tamawood’s plans and those of Mondo. Taking into account the answer to that question, the next question is whether a causal connection has been made out informed by considerations such as Mondo’s opportunity to secure access to and use of Tamawood’s drawings and apparent similarities (particularly an apparent, high degree of objective similarity in the case of floor plans for low cost project homes) coupled with an assessment of any contended explanation of the similarities by the putative infringer: “probative similarity”.
The next question, where actual copying is found to have occurred on whatever ground made out, is whether the Mondo plans exhibit a sufficient degree of objective similarity so as to constitute reproduction of the copyright work recognising that a finding of copying can add significance to objective similarity: see [24]‑[28] of these reasons as to the overlapping nature of these questions.
Thus, it is necessary to consider whether the primary judge’s error as described at [43] of these reasons leads to the result contended for by Tamawood on the appeal.
In the appeal, Tamawood says that the findings of the primary judge concerning the Torrington plan are relevant findings of fact bearing upon Mondo’s conduct concerning copying and reproduction of the Dunkeld plan. At [173], the primary judge found “substantive duplication” of the Torrington plan by Mondo’s Duplex 2 and Duplex A drawings (“D2/DA”) and also found that, although there is some variation in the arrangement of the first floor rooms, the drawings have “very similar content”. At [174], the primary judge found a sufficient degree of objective similarity to support a finding of substantial reproduction of the Torrington plan in Mondo’s D2/DA drawings.
The primary judge then made observations concerning the question of substantial reproduction of the Dunkeld plan by Mondo’s Duplex 1 plan. I will return to that matter later in these reasons.
The primary judge then considered the question of causal connection between Tamawood’s copyright works in suit and Mondo’s conduct so as to form a view about “copying”. The primary judge made the following findings about the Tamawood and Mondo plans in a general sense before turning specifically to the Torrington and Dunkeld plans.
At [191], Habitare requested Mondo to prepare drawings for the Calamvale and Brackenridge sites. At [192], those Mondo plans needed to be generally in accordance with the plans the subject of the Brisbane City Council Development Approval for each site. At [193], Mr Sweeney (Mondo) met with Mr Speer and Mr Shane O’Mara (both of Habitare) on 21 June 2006. Mr Sweeney was told that Habitare would not be engaging Tamawood as builder and was asked whether Mondo could prepare construction drawings based on the Development Approval drawings in order to obtain building approvals. At [194], by June 2006, Habitare and Mondo were both concerned about “copyright issues” in Mondo preparing plans for Habitare generally in accordance with Tamawood’s plans the subject of the Development Approvals. At [194], Mr Speer and Mr Shane O’Mara represented to Mr Sweeney that there were no outstanding issues between Habitare and Tamawood concerning use of Tamawood’s plans. At [195], Mondo produced its plans for Habitare for each site with the intention that its plans be generally in accordance with the approved Tamawood drawings, after Mondo had been shown the Tamawood drawings. Thus, at [195], an inference arose that Mondo’s plans were “copied” from the Tamawood plans.
As to the Torrington plan specifically, the primary judge made these findings.
At [198], Mondo’s D2/DA drawings were the result of copying the Torrington drawings, intentional or otherwise. At [199], “precursor Mondo designs” (that is, Mondo’s precursor plans to its D2/DA drawings) were “significantly different” in “many respects” from the Torrington plan yet Mondo’s D2/DA plans “have very similar content” (at [173]) to the Torrington plan. Moreover at [199], Mondo’s D2/DA plans represent “some departure” from Mondo’s earlier versions of its plans for a two‑storey duplex, with “no real explanation given” by Mondo for the changes. At [200], Mondo’s D2/DA plans were created so as to satisfy Habitare’s need for plans “generally in accordance with the Tamawood plans”. At [201], having accepted Habitare’s retainer, Mondo was under “some pressure” to “produce documents” which generally accorded with Tamawood’s plans which had already received Development Approval.
The primary judge notes at [201], Mr Speer’s evidence that a new Development Approval process would “take too long” and that the dilemma put by Mr Speer to Mr Sweeney was that new plans were needed substantially in accordance with the existing approvals yet the new plans must not give rise to “copyright problems” with Tamawood. At [203], Mr Keiler (an architect at Mondo) gave evidence that Mondo’s plans would have to fit the “footprint” of the Development Approval. At [204], the “direct similarities” between the Torrington plan and Mondo’s D2/DA plan are “significant”, notwithstanding that “similarities” in plans for project houses “arise out of functional necessity” such that independently‑created plans may well bear similar features.
As to the authorship of Mondo’s D2/DA design, the primary judge at [204] observes that it is clear from Mr Keiler’s evidence that the D2/DA plan was created by him “shortly after” Tamawood’s brochure drawings were printed by Mondo from the Tamawood website and reviewed by Mr Keiler; Mr Keiler’s work occurred either contemporaneously with or shortly after he received copies of the Development Approvals from Habitare; and his work occurred contemporaneously with his discussions with Habitare personnel in order to discuss Habitare’s requirements.
Thus, at [205], the primary judge says this:
While the brief to Mondo was to produce plans “generally in accordance with” the Tamawood plans, this is a circumstance where the objective similarities between the Torrington and Duplex 2/Duplex A designs are sufficiently great, and the prior access by Mondo to Tamawood’s work sufficiently clear, such that the Court should draw the inference of copying: [Pacific Gaming v Aristocrat at 454].
[emphasis added]
As to the question of objective similarities between Tamawood’s Dunkeld plan and Mondo’s Duplex 1, the primary judge at [182] observes that there are “important differences” between the two “designs”. Six such differences are identified by the primary judge. They are these:
ŸIn the [Dunkeld] the entry opens immediately into a living area. In Duplex 1 the entry opens into a hallway, which allows access to Bedrooms 2 and 3 and the bathroom, and leads to the kitchen.
ŸIn the [Dunkeld], Bedroom 3 is at the back of the dwelling, accessed through the Dining room. In Duplex 1 Bedroom 3 is at the front of the dwelling, abutting the garage.
ŸIn the [Dunkeld], the position of Bedroom 1 (with its ensuite) and Bedroom 2 are reversed compared with the positioning of those rooms in Duplex 1.
ŸIn the [Dunkeld] access to Bedrooms 1 and 2 and the bathroom is from a hallway accessed from the kitchen. In the Duplex 1, access to Bedroom 1 is from the Dining room.
ŸIn the [Dunkeld], the Living and Dining rooms are separated by the Kitchen. In Duplex 1, the Dining and Living rooms are one open space, at the rear of the dwelling.
ŸIn Duplex 1 an outside patio is accessed from the Dining room. No such patio exists on the [Dunkeld] drawings.
Having regard to the evidence of Tamawood’s expert, Mr Miller, the primary judge at [184] said this:
In my view, the quality of the differences between the [Dunkeld] and Duplex 1 means that, for all intents and purposes, the designs represent quite dissimilar dwellings.
[emphasis added]At [185], the primary judge said this:
While the overall shape of the duplex building is very similar in all three designs (in particular the Dunkeld and Duplex B):
ŸThe Conondale does not feature an ensuite to Bedroom 1, whereas the Duplex B has that feature.
ŸThe Duplex B features Bedrooms 2 and 3 at the front of the dwelling, unlike the Conondale/Dunkeld.
ŸBedroom 1 and the ensuite in Duplex B are at the back of the dwelling, unlike in the Conondale/Dunkeld drawings.
ŸThe Kitchen in Duplex B is not in the middle of the dwelling unlike the Conondale/Dunkeld design, but abutting the common wall, and the Laundry is accessed through the Kitchen.
ŸThe middle of the dwelling in the Duplex B is dominated by a Family/Living space, unlike the Conondale/Dunkeld design.
[emphasis added]
Apart from reliance placed by the primary judge upon Mr Miller’s evidence, the primary judge also said this at [186]:
Again, looking at the quality of the plans, in my view they represent significantly different dwellings.
[emphasis added]At [187], the primary judge found in these terms:
Accordingly, not only is there no reproduction in whole of the Conondale/Dunkeld in the Duplex 1 or in Duplex B, but it cannot be said that there is reproduction of a substantial part of those designs.
[emphasis added]The primary judge’s ultimate conclusion at [188] is in these terms:
It follows that in my view Tamawood’s claims involving infringement of its copyright in Conondale/Dunkeld drawings cannot be substantiated.
The primary judge then considered, in any event, whether a causal connection had been made out between Tamawood’s Dunkeld plan and Mondo’s Duplex 1 plan. As to that, the primary judge said this at [208]:
In the absence of reproduction, I am satisfied that there is no causal connectivity between those Tamawood drawings and the Mondo Duplex 1.
[emphasis added]
The primary judge also said this at [209] concerning a drawing produced by Mondo in February 2006 described as Drawing 3 to Exhibit RJS‑13 to the affidavit of Mr Sweeney sworn 20 September 2011:
In relation to exhibit RJS13‑3 produced by Mondo in February 2006, while in my view there are strong similarities between this design and the Dunkeld, this Mondo plan was not used by Mondo or Habitare as a design “generally in accordance” with the development approval. Duplex 1 was the design so used. I am not persuaded that any inference of relevance should be drawn from the existence of RJS13‑3, other than the possibility of this design representing progressive internal experimentation in designs by Mondo including by reference to the work of competitors (but evidently, in relation to this design, not used).
[emphasis added]Tamawood contests the finding of fact of no causal connection to the Dunkeld plan due to the primary judge’s error in the approach to fact finding. Tamawood says these things.
First, having regard to the drawings and plans contained in a document described as “Mondo Architects Schedule of Additional Drawing References in the Evidence of Mr Sweeney” (“Schedule of Mondo Drawings”) handed up to the Full Court (with copies to the parties) together with documents described as 12A, B, C, D, E, F, G, H, I, J and K (also handed up) based on Exhibits RJS‑11, RJS‑12 and RJS‑13 to Mr Sweeney’s affidavit of 20 September 2011, Tamawood contends that nothing in the work of Mondo prior to the early part of 2006 demonstrates drawings similar to the Dunkeld plan.
Second, in February 2006, Mondo produced the drawing in CAD form at RJS13‑3. That plan exhibits “strong similarities” to the Dunkeld plan (see [63] of these reasons and the finding at [209] of the primary judge’s reasons).
Third, the drawing of February 2006 emerged from Mondo at a time when Habitare was seeking to re‑engage with Mondo and at this time Habitare requested Mondo to prepare architectural drawings and cost those drawings.
Fourth, the reason Mondo’s February 2006 drawings exhibit, as found, “strong similarities” to the Dunkeld plan (and represent a departure from prior Mondo drawings) is explained by the circumstance that Habitare’s Development Approvals (of 1 March 2006 and 7 July 2006; see [6] and [7] of these reasons) would be based upon Tamawood’s plans and thus other architectural designs, having no approved application to each site and thus no utility for either site, would be of no interest or relevance to Habitare.
Fifth, Mr Keiler, for Mondo, played a central role in engaging with Habitare personnel in early 2006 and was largely responsible for creating the February 2006 drawing at RJS13‑3 (which is a departure from Mondo’s drawings prior to that time). Tamawood relies upon Mr Keiler’s concessions in cross‑examination that his engagement with Habitare involved some “toing and froing” consisting of either sending Habitare designs by email or engaging in face‑to‑face meetings with Habitare and receiving feedback from Habitare about the ideas presented by Mr Keiler to Habitare.
Sixth, Tamawood says that by February 2006 Mondo had produced a drawing that, first, had emerged out of Mr Keiler’s engagement with Habitare as described and, second, represented a significant departure from that which went before within Mondo. Thus, the so‑called “toing and froing” between Mr Keiler and Habitare must, it is said, have resulted in the Habitare people examining Mr Keiler’s sketches and designs and telling him the layout of the floor plan they wanted and where the rooms were to go on that floor plan. In doing so, Habitare was, it is said, “working directly” from Tamawood’s Dunkeld plan and thus instructing Mr Keiler in the essential features of the Dunkeld plan it wanted to see adopted in the Mondo plans.
Seventh, Habitare had good commercial reasons for so instructing Mondo because it knew that each Development Approval was conditioned upon carrying out each development generally in accordance with the approved Tamawood drawings. Getting on with each project was important, it is said, because, as Mr Speer said in his evidence, Habitare had settled the purchase of the development sites and “interest was ticking away, [and] it was costing us a lot of money”: see [202] of the primary judge’s reasons.
Eighth, the constraints imposed by the Development Approvals meant that Habitare found it necessary to review and be familiar with Tamawood’s plans; retain the same “footprint” for the duplex homes and ensure that any changes from the Tamawood drawings as might be reflected in the Mondo drawings for each site were small or largely inconsequential.
Finally, Tamawood says that the objective similarities between Tamawood’s Dunkeld plan and Mondo’s Duplex 1 are such that the Dunkeld plan can be seen embedded in Mondo’s plan (to use the language of Lindgren J) and one can look through Mondo’s plan and see the Dunkeld plan: see [32] of these reasons. Thus, there is said to be a sufficient degree of objective similarity between the two drawings having regard to Habitare’s use of the Tamawood plan by instructing or, in effect, filling up Mondo with the essential features of the Dunkeld plan.
Mondo supports the finding of the primary judge at [184] that the floor plans for the Dunkeld and Duplex 1 project homes represent quite dissimilar dwellings and the finding at [186] that looking at the quality of the plans, they represent significantly different dwellings. Mondo also says that by 6 April 2006 it had produced its Duplex 1 plan (see the plan described as “Duplex Single Option 3”, plan at p 17 (also marked p 261), Schedule of Mondo Drawings) well before it ever saw Tamawood’s Dunkeld plan.
The case put against Mondo, however, is that by reason of the exchanges (which seem as to real particularity largely content free “toing and froing”) between Mr Keiler and Habitare in the early part of 2006, Mondo produced by February 2006 (although apparently not specifically for the two project sites in issue in the proceedings) a drawing (RJS13‑3) which represents a departure from Mondo’s genetic footprint of floor plan designs to that time and one which, as found by the primary judge at [209], bears “strong similarities” to Tamawood’s Dunkeld plan. That plan is at [207] of the primary judge’s reasons.
I agree that the plan at [207] represents both a departure from Mondo’s earlier work and that the arrangement of rooms and the “layout and traffic flows and the shapes, proportions and interrelationships of rooms and other spaces – elements which permeate the whole of the project home” (see [37] of these reasons) reflect strong similarities with Tamawood’s Dunkeld plan, as the primary judge found. It also seems very likely that the Mondo plan at RJS13‑3 produced in February 2006 (so close to the impending Development Approval for Gawler/Norris Road on 1 March 2006), emerged out of Mondo in circumstances where Habitare personnel were acting in their dealings with Mondo, by reference to the Dunkeld plan which Habitare had before it. It seems that Mr Keiler’s authorship of the plan at RJS13‑3 was as a result of Habitare pressing strongly for a plan generally as close as possible to Tamawood’s Dunkeld plan that would be the subject of the upcoming Development Approvals and the blunt reality that undertaking a new Development Approval process would “take too long” and cause additional “interest costs” to run should a new process need to be undertaken. It seems very likely that Mr Speer instructed Mr Keiler in the features and content of RJS13‑3 with some real precision drawn from Tamawood’s Dunkeld plan.
I thus accept that an inference is open that the explanation for the emergence of CAD drawing RJS13‑3 out of Mondo’s office by February 2006 in a form that was strikingly similar to the Dunkeld plan is that Mr Keiler was giving effect to Habitare’s instructions given with precise reference to the Dunkeld plan.
Tamawood, however, does not rely upon RJS13‑3 as the contended infringing Mondo drawing. It relies upon RJS13‑3 so as to demonstrate “copying” based on instructions to Mr Keiler from Habitare.
The question then is this: Once it is accepted (by drawing the inference) that Mondo’s February 2006 drawing emerged out of access to and use by Habitare of Tamawood’s Dunkeld plan resulting in precise instructions to Mondo about the essential features of that plan (and thus a causal connection to the Dunkeld plan), does the Mondo plan said to infringe in these proceedings depicted at [17] of these reasons (which is not RJS13‑3) reveal a sufficient degree of objective similarity so as to constitute reproduction of Tamawood’s Dunkeld plan recognising the significance copying adds to objective similarity?
Just as the drawing at RJS13‑3 reveals a departure from Mondo’s earlier drawings, Mondo’s Duplex 1 said to infringe represents a departure from RJS13‑3. The primary judge finds at [209] that RJS13‑3 was not used by Mondo or Habitare. Mondo made changes to the floor plan to bring about Duplex 1. Is there a sufficient degree of objective similarity between Tamawood’s Dunkeld plan and Mondo’s Duplex 1 plan recognising the role Habitare had earlier played in instructing Mondo about the content of the Dunkeld plan so as to produce RJS13‑3?
The important considerations in answering that question seem to me to be these.
First, although the Development Approval for each site required Mondo to retain the “footprint” for the duplex, the layout, traffic flows within the house and the proportions and inter‑relationships of rooms and other spaces was not dictated by the footprint.
Second, as to the requirement that the Mondo plan be generally in accordance with the approved drawings, it does not seem to be asserted that that condition would necessarily bring about or require use of a drawing in the development on each site that would be characterised as a reproduction in a material form of the Tamawood drawings. There seems to be some latitude or flexibility to use a drawing generally in accordance with the approved drawings. Each drawing, generally, contained a number of elements: three bedrooms (and thus a structure and plan designed to accommodate a number of individuals who would normally populate three residential bedrooms in a low cost project home); an ensuite attached to one of those bedrooms (described as Bedroom 1); a bathroom immediately adjacent to a second bedroom and separated by a wall, immediately next to the ensuite so as to utilise, no doubt, plumbing connections to “wet areas”; two of the bedrooms and wet areas along an external side wall; a toilet; a living room; a dining room; a kitchen; a laundry and a garage.
Is a floor plan (other than Tamawood’s Dunkeld plan), which incorporates these general features, one which might properly be described as generally in accordance with the approved plans without necessarily being a reproduction in a material form of the approved plans? No party seems to suggest that a plan generally in accordance with the Development Approval must necessarily be an infringement of the Dunkeld plan. Tamawood contends, however, that Mondo’s particular plan is a reproduction of the Dunkeld plan recognising the two aspects of reproduction: see [28] of these reasons.
Third, the Dunkeld plan at [17] of these reasons shows an arrangement of rooms and spaces dictating shapes and traffic flows in the following way. The plan shows a porch entry into a living room. Thus, one immediately enters into a large living space. Across the diagonal space from the entry door, is a “false head” entry to the kitchen sited in the centre point of the house. The kitchen looks onto and serves the dining room. Thus, entry into the house engages the amenity of the living room which leads to the kitchen and across the kitchen space to the dining room. The left side wall of the living room divides off the main bedroom at the front of the house (described as Bedroom 1). That wall continues to the rear of the house dividing the dining room from Bedroom 2. That wall contains a “false head” entry and exit through a space in that wall from the kitchen into an area that provides spatial access to a number of rooms. The possibilities are, to the left, passage past the bathroom and entry through a door into Bedroom 1; passage to the toilet; passage to the bathroom or passage to an entry door to Bedroom 2. The laundry is located to the right of the kitchen behind the garage and is located between the kitchen on one side and the block common wall on the right hand side. To the right of the dining room and behind the laundry space is Bedroom 3. The single garage is represented by the space between the block common wall on the right hand side of the diagram and the living room wall on the left side. The footprint for the duplex has the dimensional characteristics reflected in the drawing at [17]. The dimensions of each room are also set out in the floor plan at [17]. In the Dunkeld, the main bedroom at the front of the house has an ensuite bathroom. Apart from the ensuite bathroom servicing the main bedroom, the plan provides for an entirely separate toilet and a separate bathroom.
Fourth, Mondo’s Duplex 1 has a footprint which reflects different dimensions as to the footprint itself and other dimensional differences. For example, Tamawood’s Dunkeld is 11.125 metres wide and 11.460 metres deep. Mondo’s Duplex 1 is 10.800 metres wide and 11.800 metres deep. In the Mondo plan, entry is from a porch through the front door into an entry corridor. The three bedrooms making up the duplex are clustered together in the sense that they are all positioned away from the block common wall where the mirror image duplex sets out the living space for the immediate neighbour. In the Mondo plan, one enters by the entry corridor which has a bedroom to the left and a bedroom to the right. On the right hand front side is Bedroom 3 and on the left hand front side is Bedroom 2. Having entered the dwelling, the passageway continues between Bedrooms 2 and 3 to the end of Bedroom 3 and into the kitchen which is sited in the centre of the dwelling. The kitchen engages with the amenity of a combined dining and living room which in turn provides access and entry to a large patio area immediately adjacent to the dining room. The patio area is a quite substantial space.
The amenity of the house involves an L shape cluster of bedrooms and wet areas to the left of the structure along the external wall and the third bedroom at the front of the house. It involves another L shaped cluster of what might be described as the societal amenity of the house of food preparation, cooking, dining, entertaining and living consisting of the kitchen and the combined open space of a living and dining room to the back of the structure inter‑relating with a patio and pergola.
The traffic flows draw a person down the entry hallway into the bedroom cluster or alternatively into the integrated kitchen, dining, living and patio areas. Access into the wet areas involves a different spatial arrangement to that of the Dunkeld. Rather than moving through a false head entry from what otherwise amounts to the mid‑point of the kitchen wall into a space serving access to Bedroom 1, the bathroom, the toilet and Bedroom 2, a person moves from the kitchen into the end of the entry corridor so as to gain access to either the separate bathroom or the separate toilet or Bedroom 2. Access to Bedroom 1 is by a doorway directly into that bedroom from the dining room.
For my part, having regard to the layout and traffic flows and the shapes, proportions and inter‑relationships of rooms and other spaces being the elements which permeate the whole of Mondo’s Duplex 1 project home, I am not satisfied that there is a sufficient degree of objective similarity between Tamawood’s Dunkeld plan and Mondo’s Duplex 1 plan so as to constitute reproduction of the Dunkeld plan in a material form. Nor am I satisfied that Mondo’s plan reproduces a substantial part of the Dunkeld plan. There is no doubt that both plans show an arrangement of two bedrooms and wet areas in conjunction with one another on the external wall of the duplex (that is, in the plans at [17]) on the left hand external wall of the dwelling. In that sense, both plans reflect the idea of an arrangement of rooms as far away as possible from the common block wall between the two dwellings which share that common block wall. There would be no rational point in the notion of locating Bedrooms 1 and 2 and the wet areas along the common block wall immediately next to Bedrooms 1 and 2 and the wet areas of the mirror image duplex.
The idea in each plan is to place the two principal bedrooms and wet areas on the exterior walls of each duplex for the obvious reason. The particular arrangement of those rooms and wet areas is not, however, in the same terms and for my part I do not regard the location and inter‑relationship of those bedrooms and wet areas as a reproduction of a substantial part of the Dunkeld plan. In any event, during the course of oral submissions before the Full Court emphasis was placed by Tamawood upon the notion that reproduction had occurred independently of any question of reproduction of a substantial part. Both limbs remained alive recognising, however, the nature of reproduction as discussed at [29] of these reasons.
For my part, I would dismiss Tamawood’s appeal from the orders of the primary judge dismissing its claim of copyright infringement of the Dunkeld plan.
The nine issues before the Full Court
Issue One
Did the primary judge err in finding that the conduct of Habitare (and those associated with it) and Mondo was not authorised by a licence? I agree with the observations of Jagot and Murphy JJ.
Issue Two
Is Tamawood precluded from arguing that an inference of indirect copying by Mondo should be drawn by reason of the pleadings and the way the case was run before the primary judge? I agree with the observations of Jagot and Murphy JJ.
Issue Three
If Tamawood is not so precluded, did the primary judge err in finding that Mondo did not infringe the copyright in Tamawood’s Dunkeld plan? The primary judge did not fall into error.
Issue Four
Did the primary judge err in finding that Mondo was precluded from arguing that it was an “innocent infringer” within s 115(3) of the Copyright Act 1968 (Cth)? I generally agree with the observations of Jagot and Murphy JJ.
Issue Five
Did the primary judge err in finding that Mr Peter O’Mara and Mr Johnson of Habitare did not authorise Habitare’s infringements of Tamawood’s Torrington and Dunkeld plans? I agree with the observations of Jagot and Murphy JJ as to the Torrington infringement.
Issue Six
Did the primary judge err in finding that Mr Peter O’Mara, Mr Johnson and/or Mondo are not liable for additional damages under s 115(4) of the Copyright Act? I agree with the observations of Jagot and Murphy JJ.
Issue Seven
Did the primary judge err in finding that the Bloomer parties were “innocent infringers” under s 115(3) of the Copyright Act? I agree with the observations of Jagot and Murphy JJ.
Issue Eight
Did the primary judge err in respect of the costs orders made in favour of the Bloomer parties? I agree with the observations of Jagot and Murphy JJ.
Issue Nine
Did the primary judge err in finding Mr Shane O’Mara liable to Mondo for misleading and deceptive conduct? I agree with the observations of Jagot and Murphy JJ.
The parties ought to confer and submit within 14 days agreed or proposed competing orders reflecting the position adopted by the majority judges, including submissions with respect to costs.
I certify that the preceding one hundred and one (101) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Greenwood Associate:
Dated: 15 May 2015
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
QUD 223 of 2014
ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA
BETWEEN: TAMAWOOD LIMITED ACN 010 954 499
AppellantAND: HABITARE DEVELOPMENTS PTY LTD (ADMINISTRATORS APPOINTED) (RECEIVERS AND MANAGERS APPOINTED) ACN 122 935 497
First RespondentBLOOMER CONSTRUCTIONS (QLD) PTY LTD
ACN 071 344 100
Second RespondentPETER FREDERICK O'MARA
Third RespondentDAVID GAVIN JOHNSON
Fourth RespondentWAYNE NORMAN BLOOMER
Fifth RespondentMONDO ARCHITECTS PTY LTD ACN 085 992 990
Sixth Respondent
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
QUD 235 of 2014
ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA
BETWEEN: MONDO ARCHITECTS PTY LTD ACN 085 992 990
Appellant
AND: TAMAWOOD LIMITED ACN 010 954 499
Respondent
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
QUD 240 of 2014
ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA
BETWEEN: SHANE ANDREW O’MARA
AppellantAND: TAMAWOOD LIMITED ACN 010 954 499
First RespondentMONDO ARCHITECTS PTY LTD ACN 085 992 990
Second RespondentRAYMOND JOHN MCDONALD SWEENEY
Third Respondent
JUDGES:
GREENWOOD, JAGOT AND MURPHY JJ
DATE:
18 MAY 2015
PLACE:
SYDNEY VIA VIDEO-LINK TO BRISBANE
REASONS FOR JUDGMENT
JAGOT AND MURPHY JJ:
THE ISSUES
This matter involves three appeals and four notices of contention between multiple parties arising from orders consequential on two judgments (Tamawood Ltd v Habitare Developments Pty Ltd (Administrators Appointed) (Receivers and Managers Appointed) (No 3) (2013) 101 IPR 225; [2013] FCA 410, referred to below as the principal judgment and Tamawood Ltd v Habitare Developments Pty Ltd (Administrators Appointed) (Receivers and Managers Appointed) (No 6) [2013] FCA 1383, referred to below as the costs judgment).
Despite this apparent complexity, there are nine issues which arise for determination. To understand these issues it is necessary to identify the parties and the claims between them.
Tamawood Ltd (Tamawood) designs and builds project homes.
Habitare Developments Pty Ltd (Habitare), now in liquidation, was a developer of low cost, high density housing. Habitare used other subsidiary companies, in this case Eight March Pty Ltd (as trustee of the Eight March discretionary trust) and First Priority Developments Pty Ltd, to acquire and develop sites. It is unnecessary to distinguish between Habitare and its subsidiary companies for the purposes of this matter and thus all references below are to Habitare despite the fact that the relevant company might have been one of the subsidiaries.
Peter O’Mara was a director of Habitare. David Johnson was also a director and the financial officer of Habitare. Mr Johnson was declared bankrupt on 14 July 2014. His trustee in bankruptcy was notified of this matter and advised that he did not intend to appear.
Shane O’Mara is Peter O’Mara’s son and worked for Habitare.
Peter Speer also worked for Habitare.
Mondo Architects Pty Ltd (Mondo) is a firm of architects. Raymond Sweeney is a director of Mondo. Shane Keiler is an employee of Mondo who prepares architectural plans.
Bloomer Constructions (Qld) Pty Ltd is a building company. Wayne Bloomer is a director and the principal of this company. Together, they are referred to below as the Bloomer parties.
Habitare, through its subsidiaries, owned and wished to develop two sites with low cost housing, one at Hamish Street, Calamvale and the other at Gawler Street/Norris Road Brackenridge. Habitare entered into discussions with Tamawood about designing and building the low cost housing. Tamawood prepared plans including plans for housing known as the Conondale/Dunkeld (referred to below as the Dunkeld), a single storey duplex, and the Torrington, a two storey duplex. With Tamawood’s agreement, Habitare lodged Tamawood’s plans with the Brisbane City Council (the Council) and obtained development approvals for the development of each site based on those plans. Habitare did not use Tamawood to construct the buildings on either site. It approached Mondo to prepare construction plans. The conditions of the development approvals required, amongst other things, the buildings to be constructed “generally in accordance with” the Tamawood plans. Mondo prepared plans for the two sites to enable building certificates to be obtained. Building certificates were obtained based on the Mondo plans. Habitare, after its initial builder went into liquidation, engaged the Bloomer parties to complete the construction of the buildings on each site. The Bloomer parties did so.
Insofar as now relevant, Tamawood claimed that Mondo’s plans infringed copyright in Tamawood’s plans for the Dunkeld and the Torrington houses. Tamawood sued Habitare, Peter O’Mara and Mr Johnson of Habitare, Mondo, and the Bloomer parties in respect of the alleged infringements of copyright under the Copyright Act 1968 (Cth) (the Copyright Act). Mondo sued Habitare, Mr Speer and Shane O’Mara for misleading and deceptive conduct under the (then in force) Trade Practices Act 1974 (Cth).
The primary judge found for Tamawood against Habitare and Mondo but only in respect of the Torrington plan, not the Dunkeld plan. In so doing, the primary judge rejected an argument by Habitare and parties associated with it, including Shane O’Mara, that Tamawood had authorised Habitare’s acts under a contractual licence, and another argument by Mondo that Tamawood had authorised Habitare’s and thus Mondo’s acts under a non-contractual licence.
The primary judge rejected Tamawood’s claims against Peter O’Mara and Mr Johnson for authorisation of Habitare’s infringement of Tamawood’s copyright in the Torrington plan.
The primary judge rejected Tamawood’s claim that it was entitled to orders against Habitare, Peter O’Mara and Mr Johnson and Mondo for additional damages under s 115(4) of the Copyright Act.
The primary judge found the Bloomer parties to be “innocent infringers” under s 115(3) of the Copyright Act but concluded that Mondo was not entitled to argue that it was also an “innocent infringer”. Her Honour ordered Tamawood to pay the costs of the Bloomer parties including costs on an indemnity basis from 2 September 2011 onwards, the date on which a letter offering to settle the proceedings had been sent by the solicitor for the Bloomer parties to the solicitor for Tamawood.
The primary judge found Habitare liable to Mondo for misleading and deceptive conduct and that Mr Speer and Shane O’Mara were “knowingly concerned” in Habitare’s conduct and thus also liable to Mondo in this regard.
The issues that arise on the appeals and the notices of contention, against this background, may be summarised as follows:
(1)Did the primary judge err in finding that the conduct of Habitare (and those associated with it) and Mondo was not authorised by a licence?
(2)Is Tamawood precluded from arguing that an inference of indirect copying by Mondo should be drawn by reason of the pleadings and the way the case was run before the primary judge?
(3)If Tamawood is not so precluded, did the primary judge err in finding that Mondo did not infringe copyright in Tamawood’s Dunkeld plan?
(4)Did the primary judge err in finding that Mondo was precluded from arguing that it was an “innocent infringer” within s 115(3) of the Copyright Act?
(5)Did the primary judge err in finding that Peter O'Mara and Mr Johnson of Habitare did not authorise Habitare’s infringements of Tamawood’s Torrington and Dunkeld plans?
(6)Did the primary judge err in finding that Peter O’Mara, Mr Johnson and/or Mondo are not liable for additional damages under s 115(4) of the Copyright Act?
(7)Did the primary judge err in finding that the Bloomer parties were “innocent infringers” under s 115(3) of the Copyright Act?
(8)Did the primary judge err in respect of the costs orders made in favour of the Bloomer parties?
(9)Did the primary judge err in finding Shane O’Mara liable to Mondo for misleading and deceptive conduct?
It is convenient to deal with the primary judge’s reasons by reference to each of the nine issues set out above, given that her Honour was dealing with a much broader dispute between the parties.
ISSUE 1 – THE LICENCE
Primary judge’s reasons
The primary judge dealt with the licence issue at [95] to [150] of the principal judgment. The primary judge concluded that Tamawood had granted to Habitare a licence (albeit a bare rather than a contractual licence) authorising Habitare to use the Tamawood plans “in the application to the Brisbane City Council for development approval” (at [147]). However, “once Habitare resolved that it would not engage Tamawood to build those dwellings and took steps to engage someone else, Habitare was no longer entitled to use the” Tamawood plans (at [149]). The primary judge also noted that if the licence was contractual, contrary to the conclusion she had reached, then in any event the contractual licence would have been “subject to a similar term” (at [150]).
In reaching these conclusions the primary judge observed that there was little evidence about the dealings between Tamawood and Habitare. She relied, in particular, on the following evidence:
·A conversation between representatives of Tamawood and Habitare in which Habitare’s representatives said Habitare wanted Tamawood to build the duplexes on the Calamvale and Brackenridge sites using plans of Tamawood in which the Tamawood representative said “[w]e are happy to form a relationship where we will invest our drafting time and our money on the understanding that we be appointed as the builders and we will then work together” and the Habitare representative said Habitare was happy and Tamawood should “go ahead and prepare the plans for the two projects” (at [102]).
·Subsequent discussions between representatives of Tamawood and Habitare in which it was said that Tamawood would be appointed the builder for the development of the two sites (at [103]).
·Tamawood’s business model, in which Tamawood builds houses in accordance with its plans (at [104]).
·The fact that when Habitare realised it could not resolve outstanding issues relating to Tamawood being appointed the builder (Tamawood having already given Habitare the plans to use for the development application), Habitare then “went elsewhere to get new plans done” (at [110]).
·The fact that Habitare and Tamawood “took it for granted” that Tamawood would be appointed the builder for the projects, that being understood by “all parties” (at [112]).
·The fact that despite numerous meetings between Habitare and Tamawood the relationship came to an end because three issues could not be resolved, being whether there should be separate contracts for each building or a single contract for each project, whether Tamawood should be paid progressively or on a lump sum basis, and the timing for completion of the building works (at [113]).
Shane O’Mara’s submissions
Shane O’Mara emphasised the following evidence in support of his contention that there was a contractual rather than a bare licence:
…Mr Souter-Robertson [Tamawood] told Mr Speer [Habitare]:
We are happy to form a relationship where we invest our drafting time and our money on the understanding that we be appointed as the builders and we will then work together.
Mr Speer said:
“I am more than happy with that. So go ahead and prepare the plans for the two projects.”
Mr Souter-Robertson gave evidence that:
In the same meaning Shane said words to the effect:
How much is it going to cost to get these plans from you so that we can pass them to our own town planner who is going to do the application to the Council. Our town planner will be Harvey Property Consultants.
I said words to the effect:
We know Harvey Property Consultants. We don’t charge for you using our plans to get the development approval from Council as long as we build the duplexes as soon as the plans are approved and the civil works are underway.
Shane said:
Of course Tamawood will be the builder.
Mr Mizikovsky [Tamawood] gave the following evidence:
… This then lead to the second issue namely the question of what would happen if Habitare got the building approvals and then Tamawood decided to increase its prices. I was asked by either Peter Speers [sic] or Peter O’Mara in words to the effect
‘What happens if we get the building approvals and then Tamawood decides to increase prices’.
I replied in words to the effect: “The prices for Tamawood designs are all electronically updated and continuously displayed on Tamawood’s website and therefore the margins that Habitare will be paying will remain constant and any price changes will be in common with the remainder of the industry.
…
I can also recall another similar conversation in relation to the second issue with Peter [sic] Speers [sic] and Peter O’Mara in which I said words to the effect ‘you can use our plans because the price is always available on our website’.
Tamawood also submitted that:
Moreover, at the very least, there was conferred by Mr P. O’Mara and Mr Johnson on Shane O’Mara and Peter Speers “a general permission” such that “it is…unnecessary that the authorizing party have knowledge that a particular act comprised in the copyright will be done”: per Jacobs J University of New South Wales v Moorhouse (1975) 133 CLR 1 (Moorhouse) at pp 20-21 (in this respect unaffected by Roadshow Films Pty Ltd v iiNet Ltd (2012) 248 CLR 42), which is authorisation within the Act.
Peter O’Mara’s submissions
For Peter O’Mara it was submitted that:
Tamawood’s task was to prove a suite of facts sufficient to warrant the conclusion that it was more likely than not that Mr Peter O’Mara knew that it was likely that copyright infringement would take place and, having that knowledge, did nothing to stop it.
The facts upon which Tamawood rely in this appeal are sufficient to demonstrate its failure. He knew, as Tamawood points out, that Mondo had been engaged to assist in avoiding the difficulty which the decision to part ways with Tamawood presented. The difficulty presented was Tamawood’s copyright. Any person with the level of comprehension that Tamawood wants to attribute to Mr Peter O’Mara would have drawn that conclusion in the circumstances and would have understood the appointment of Mondo to be directed towards avoiding that difficulty.
That being so, Tamawood simply failed to raise its circumstantial case against Mr Peter O’Mara beyond the level of competing conjectures.
That failure is not repaired by reference to the much-misunderstood principles articulated in Jones v Dunkel. That case is (relevantly) authority for the proposition that the Court may (not must) infer from the failure of a party to call a witness that the witness would not have said anything to assist the party’s case.
Jones v Dunkel is not authority for the proposition that the Court can infer from such circumstances that the witness would have said something to assist the opposing party’s case. That is what Tamawood suggests the learned trial judge should have done, although it does identify the precise fact to be inferred.
It is also important to understand that Jones v Dunkel does not hold that, in the absence of a party giving evidence, the Court may not draw an inference favourable to that party on the proven facts. Indeed, that is antithetical to Jones v Dunkel. The point is that the facts must be examined, however proved, to determine whether, and if so, what, inference can be drawn.
…
This case is distinguishable from Moorhouse. In Moorhouse, the University supplied the photocopier and the books and there was an implied invitation for users to use the photocopiers to copy the library’s books. In this situation, Mr Peter O’Mara and Mr Johnson gave Mr Shane O’Mara and Mr Peter Speer conduct of the early stage of the developments. Mr Peter O’Mara and Mr Johnson did not hand Tamawood’s plans to Mr Shane O’Mara and Mr Speer and say ‘use these’. There has been no suggestion of their creating some culture encouraging, or workplace facilitating, infringement.
In any event, supposing that knowledge could be implied through the “general permission” as Tamawood contends (presumably satisfying the mental element that her Honour found was lacking), section 36(1) of the Copyright Act specifies ‘the matters that must be taken into account’ when considering authorisation including whether reasonable steps were taken to avoid or prevent the doing of the act. As set out above, her Honour found that engaging Mondo to prepare new plans by Mr Peter O’Mara constituted reasonable steps. A finding which Tamawood does not seek to disturb.
Mr Johnson, who has been declared bankrupt, did not appear. His trustee in bankruptcy raised no objection to the matter proceeding against Mr Johnson.
Discussion
Contrary to the submissions for Peter O’Mara, the evidence, as referred to by Tamawood, presented a case overwhelmingly in favour of the inference that Peter O’Mara and Mr Johnson authorised the infringements. The issue is not one to be resolved at the level of principle, by reference either to Blatch v Archer or Jones v Dunkel. The problem is that, on the facts as found and the undisputed evidence, no inference could properly be drawn that Peter O’Mara and Mr Johnson considered that the possibility of any infringement of Tamawood had been averted by the appointment of Mondo.
First, in the circumstances as described by Tamawood in its submissions, Peter O’Mara and Mr Johnson must have known that the development, as constructed, would have to be “generally in accordance with” the Tamawood plans. To state the obvious, this had the consequence that in order to be useful any plans prepared by Mondo would also have to be “generally in accordance with” the Tamawood plans.
Second, Peter O’Mara and Mr Johnson must be taken to have known that Habitare’s choice was either to avoid any risk of infringement by obtaining new development approvals on the basis of new plans (which, for obvious and possibly compelling commercial reasons Habitare did not wish to do) or to proceed by instructing Mondo to prepare construction plans “generally in accordance with” the Tamawood plans. While the requirement for the construction plans to be “generally in accordance with” the Tamawood plans did not necessarily mean that there would be an infringement of copyright (the two concepts being different and arising in different contexts), it is (or ought to have been) obvious that the shortcut which Habitare wished to take involved a risk of infringing copyright that obtaining new development approvals would have avoided. The evidence discloses keen awareness of this risk on the part of Habitare and Mondo – an awareness that Peter O’Mara and Mr Johnson must be taken to have shared.
Third, despite this awareness, Peter O’Mara and Mr Johnson must also be taken to have endorsed and ultimately approved the shortcut approach.
In these circumstances, the proper inferences to be drawn are that Peter O’Mara and Mr Johnson had the power to prevent the infringements. They could have required Shane O’Mara and Mr Speer to obtain fresh development approvals in order to avoid the real risk of infringement that the shortcut approach involved but did not do so. In so doing, it must be inferred that they preferred Habitare’s commercial interests to those of Tamawood (not surprisingly). They were in ultimate control of the development process and the actions taken by Habitare and its subsidiaries. They did not take steps to avoid the infringement either by ensuring that fresh development approvals, not based on the Tamawood plans, were sought or that the conduct of Habitare’s employees and their instructions to Mondo would not involve any infringement of copyright in the Tamawood plans. In these circumstances, there was no proper foundation for inferring that Peter O’Mara and Mr Johnson believed that the possibility of infringement of copyright in the Tamawood plans had been averted by the engagement of Mondo. It was the engagement of Mondo to prepare construction plans that were “generally in accordance with” the Tamawood plans that itself gave rise to the obvious risk, perceived by all, of infringement of copyright. The fact that the Habitare employees and Mondo might have thought (or hoped) they had successfully avoided that risk does not speak against the conclusion that Peter O’Mara and Mr Johnson authorised the infringements of copyright found to have been committed by Habitare’s employees and its subsidiaries.
The arguments put for Peter O’Mara against this conclusion are not persuasive. They fail to confront the reality of the circumstances as disclosed in the submissions for Tamawood summarised above. Those circumstances demand the inference that it was more likely than not that Peter O’Mara and Mr Johnson knew that there was a real risk that the process in which Habitare was involved would infringe Tamawood’s copyright and did nothing to avert that real risk. To the extent that it was submitted that the risk that they needed to appreciate was that it was more likely than not that copyright would be infringed, that submission should not be accepted. Authority was not cited to support it. As a matter of principle, why it is necessary, for authorisation to be found, for the risk of copyright infringement perceived by a principal to itself be a probable, as opposed to a real (in the sense of not trivial or fanciful) risk of infringement is obscure. In any event, the circumstances do not lead to a conclusion of mere competing conjectures, for the reasons already given.
It follows from these matters that grounds 2 and 3 of Tamawood’s appeal should be allowed.
ISSUE 6 – ADDITIONAL DAMAGES?
Primary judge’s reasons
The primary judge dealt with the issue of additional damages under s 115(4) of the Copyright Act at [266] to [275] of the principal judgment.
Section 115(4) provides as follows:
(4) Where, in an action under this section:
(a) an infringement of copyright is established; and
(b) the court is satisfied that it is proper to do so, having regard to:
(i) the flagrancy of the infringement; and
(ia) the need to deter similar infringements of copyright; and
(ib) the conduct of the defendant after the act constituting the infringement or, if relevant, after the defendant was informed that the defendant had allegedly infringed the plaintiff’s copyright; and
(ii) whether the infringement involved the conversion of a work or other subject matter from hardcopy or analog form into a digital or other electronic machine readable form; and
(iii) any benefit shown to have accrued to the defendant by reason of the infringement; and
(iv) all other relevant matters;
the court may, in assessing damages for the infringement, award such additional damages as it considers appropriate in the circumstances.
The primary judge referred to Futuretronics.com.au Pty Limited v Graphix Labels Pty Ltd(No 2) (2008) 76 IPR 763; [2008] FCA 746 at [268] in these terms:
The section entitles the copyright owner to damages for “flagrant” infringement. In considering s 115(4) in Futuretronics.com.au Pty Limited v Graphix Labels Pty Ltd(No 2) (2008) 76 IPR 763; [2008] FCA 746, Besanko J observed:
[19] The meaning of “the flagrancy of the infringement” has been described in various ways. In Ravenscroft v Herbert and New English Library Limited [1980] RPC 193 Brightman J referred to it as “scandalous conduct, deceit and such like; it includes deliberate and calculated copyright infringement”; in Prior v Lansdowne Press Pty Ltd [1977] VR 65 at 70, Gowans J (at 70) referred to it as a “calculated disregard of the plaintiff’s rights, or cynical pursuit of benefit”; and in Raben Footwear Pty Ltd v Polygram Records Inc (1997) 75 FCR 88 at 103 flagrancy was said to connote conduct which could probably be described as “glaring, notorious, scandalous” or “blatant”. In Polygram at 461-462 Lockhart J said that flagrancy did not include mere mistakes or carelessness and that if the infringer mistakenly believed that he or she owned the relevant copyright, or acted in the bona fide belief that no copyright subsisted in the plaintiff’s work then the conduct was not flagrant.
Thereafter, the primary judge concluded that the evidence did not support a conclusion that Habitare, Peter O’Mara or Mr Johnson should be liable for additional damages under s 115(4) for the following reasons:
272 In relation to Habitare, I accept Mr Musgrave’s submission that the Habitare executives, in particular Mr Speer, having perceived there to be a copyright issue concerning the Tamawood drawings, sought to address that issue by arranging for new plans to be drawn. While there is also evidence that Habitare had indicated to Mondo that Habitare had resolved any outstanding issues with Tamawood concerning the Tamawood drawings and the project sites (when in fact such resolution had not occurred), I am not persuaded that the facts support a finding of flagrant infringement of copyright.
273 In relation to Mondo, I consider its actions were predicated upon at least two false assumptions, namely:
Ÿits belief that Tamawood had in fact used Mondo’s plans (particularly in relation to the Torrington drawings); and
Ÿits belief that Habitare had resolved outstanding issues with Tamawood.
274 While these issues could possibly have been, in turn, resolved by actions and inquiries from Mondo, such a conclusion is speculative. I am not persuaded that the events involving Mondo are supportive of a finding of a calculated disregard of Tamawood’s rights by Mondo, or scandalous or deceitful conduct.
Tamawood’s submissions
Tamawood submitted that:
Where infringement is established the Court may award additional damages, if satisfied it should having regard to flagrancy and other matters referred to in s 115(4): Aristocrat Technologies v DAP Services (2007) 157 FCR 64 per Black CJ and Jacobson J at [40]. Flagrancy is not a prerequisite for an award of additional damages: ibid at [41]. Deterrence and the benefit which accrued to the infringer are relevant factor: ibid at [43] and [44].
The Habitare companies, the directors and Mondo had knowledge of Tamawood’s copyright in the drawings but nevertheless proceeded on a path fraught with risk (ie making drawings “Generally in Accordance” with Tamawood’s drawings).
Competing submissions
Mondo stressed that there was no error in the primary judge limiting her consideration to the issue of flagrancy because Tamawood pleaded an entitlement to additional damages based solely on the flagrancy of the conduct said to constitute the infringements.
Peter O’Mara relied on the same submissions that had been put in support of his defence of the primary judge’s finding of lack of authorisation.
Discussion
Tamawood’s contentions of error by the primary judge should be rejected. It is true that flagrancy is not a pre-condition to a conclusion that additional damages should be awarded under s 115(4). Tamawood, however, pleaded a case for additional damages principally based on the conduct being flagrant. The primary judge reasonably concluded that the conduct resulting in the infringements was not flagrant. The primary judge cannot properly be criticised for her focus on flagrancy in circumstances where such a characterisation was a critical component of the way in which Tamawood pleaded its case.
For these reasons ground 4 of Tamawood’s appeal should be dismissed.
ISSUE 7 – BLOOMER PARTIES – INNOCENT INFRINGERS?
Primary judge’s reasons
The primary judge, having identified the terms of s 115(3) of the Copyright Act (set out above), summarised the applicable principles in these terms:
258 Section 115(3) provides for relief in the form of an account of profits only in circumstances of innocent infringement. It has been the subject of considerable previous judicial analysis (I note in particular the list of cases identified by Gordon J in Krueger Transport Equipment Pty Ltd v Glen Cameron Storage & Distribution Pty Ltd (No 2) [2008] FCA 1493 at [10]).
259 In Milwell Pty Ltd v Olympic Amusements Pty Ltd (1999) 85 FCR 436 the Full Court of the Federal Court observed at [52] that:
To obtain the protection of s 115(3) a defendant must establish (i) an active subjective lack of awareness that the act constituting the infringement was an infringement of the copyright, and (ii) that, objectively considered, he or she had no reasonable grounds for suspecting that the act constituted an infringement.
260 Similarly in Golden Editions Pty Ltd v Polygram Pty Ltd (1996) 61 FCR 479 Burchett and Tamberlin JJ said at 480:
But in general the question is not whether the defendant knew the identity of the owner of the copyright, but whether the defendant has established a lack of awareness, and of reasonable grounds for suspecting, that the relevant act was an infringement of the copyright which was infringed, in whomsoever that copyright might be vested.
(Emphasis added.)
261 A deliberate choice not to inquire, in such circumstances, may enable a further finding, since it may suggest a mind in which real suspicion resided: Golden Editions at 488.
Insofar as the Bloomer parties are concerned, the primary judge said:
263 Bloomer Constructions has substantiated its defence of innocent infringement of copyright under s 115(3) in respect of the Tamawood drawings. I so find because:
ŸBloomer Constructions had no involvement in the original process whereby development approval was obtained in relation to the Calamvale and Brackenridge sites.
ŸI am satisfied that Bloomer Constructions (and in particular Mr Bloomer) was unaware of any potential infringement of Tamawood’s copyright in relation to the plans prepared by Mondo (or Caprice Group) and which were the basis of the construction of dwellings at the Calamvale and Brackenridge sites.
ŸThere was no reference to Tamawood on the Mondo (or Caprice Group) plans relating to the Calamvale and Brackenridge sites.
ŸWhile it is clear from the development approvals that Habitare had engaged Tamawood earlier in the development process, this does not, of itself, create grounds for suspicion in a builder that subsequent plans drawn by reputable firms (Caprice Group and Mondo) had infringed copyright in Tamawood plans. The Court is able, in my view, to draw the inference that the engagement of successive architects during a development process is not in itself unusual or controversial. Certainly in cross-examination Mr Sweeney commented on situations where clients, who had already consulted other architects, sought to consult him (Sweeney 20/9/2011 affidavit paras 25-26). Similarly, creation by third parties of designs “generally in accordance” with already approved plans prepared by someone else was not cause for comment as unusual by any expert in these proceedings.
ŸIndeed, at the time of engagement of Bloomer Constructions it appears that civil work had already been undertaken at the Brackenridge site by Caprice Group. In my view a reasonable inference capable of being drawn from this fact by Mr Bloomer and Bloomer Constructions was that Caprice Group, if not the original architect in relation to at least some of the plans, had provided new plans to Habitare for development purposes superseding plans originally provided by Tamawood.
Tamawood’s submissions
Tamawood said this in support of its contention of error by the primary judge:
In Golden Editions Pty Ltd v Polygram Pty Ltd (1996) 61 FCR 479 at 480 Burchett and Tamberlin JJ made the following observations in relation to section 115(3):
In para 308 of the [Spicer Committee] report, which plainly lead to the current provision, the concern expressed is that there should be protection for a person who has taken ‘every step possible to ensure that he obtained a license from the proper person yet, through no fault of his own, and despite searching inquiry, he could be in error (emphasis added).
Tamawood submits that Bloomer Constructions and Mr Bloomer did not take “every step possible”, make “searching inquiry” or infringe “through no fault of [their] own”.
The evidence showed that Bloomer Constructions was the builder and that a condition of the DA was that a full copy of the DA, including (Tamawood’s Tamawood-branded) plans the subject of the approval were to be kept on site, inter alia, by the builder. Bloomer Constructions did not do so. The DA was annexed to the construction contracts (including the Harvey Developments site plan but apparently without Tamawood’s plans)… The evidence also showed that Mr Bloomer, the controlling mind of Bloomer Constructions, took note of Tamawood’s house names on the site plans (but did not know these were Tamawood names)… Nevertheless, those names were different to the Mondo named houses on the construction drawings.
Had Mr Bloomer reviewed the DA approvals and/or retained a copy of them then it would have enlivened them to the fact that Tamawood had been involved in the project. Bloomer Constructions cannot rely on its own non-compliance to establish that it took “every step possible”, made “searching inquiry” or infringed “through no fault of [its] own”.
Bloomer parties’ submissions
The Bloomer parties noted that the statement from Golden Editions which Tamawood cited excluded the relevant statement of principle (at 480) which is in these terms:
But in general the question is not whether the defendant knew the identity of the owner of the copyright, but whether the defendant has established a lack of awareness, and of reasonable grounds for suspecting, that the relevant act was an infringement of the copyright which was infringed, in whomsoever that copyright might be vested.
They also stressed that the primary judge’s findings were reasonably open on the evidence and disclosed no error given the evidence that:
(a) Bloomer Constructions had no knowledge that Tamawood had ever been involved in the preparation of any plans or drawings.
(b) Bloomer Constructions was engaged when the building construction work at the Calamvale and Bracken Ridge sites had already commenced. The engagement of Bloomer Constructions occurred following the insolvency of the original builder the Caprice Group.
(c) Bloomer was aware from the approved building plans that Caprice Homes was identified on the plans and made enquiries to ensure that there were no copyright issues in relation to the Caprice Group plans.
(d) Neither Bloomer Constructions nor Bloomer were ever provided with any document that contained any reference to Tamawood or to any of its associated entities.
Discussion
The submissions for the Bloomer parties should be accepted. The primary judge’s analysis of the evidence relevant to the issue of the application of s 115(3) was orthodox. The submissions of Tamawood seek a different factual conclusion without establishing any error on the part of the primary judge. On the evidence the primary judge was entitled to find (and, indeed, it is the better view) that the Bloomer parties had no awareness of anything to do with Tamawood and had no reason for suspecting any infringement of copyright.
Tamawood’s counsel of perfection, that the Bloomer parties were required to have a copy of the development approval on site during construction and, had they done so would have become aware of Tamawood’s involvement, does not make their conduct unreasonable. Nor does it establish the existence of any reasonable ground for suspecting any infringement of copyright. That fact is simply insufficient to take the Bloomer parties outside the scope of s 115(3).
Tamawood’s appeal grounds 5 and 6 must be dismissed for these reasons.
ISSUE 8 – BLOOMER PARTIES COSTS’ ORDERS
The primary judge made the following orders consequential upon her costs judgment:
Tamawood Limited ACN 010 954 499 pay the costs of Bloomer Constructions (Qld) Pty Ltd ACN 071 344 100 and Wayne Norman Bloomer:
Ÿincurred prior to 2 September 2011 of and incidental to these proceedings on a party and party basis;
Ÿincurred on or after 2 September 2011 of and incidental to these proceedings on an indemnity basis;
such costs to be taxed if not otherwise agreed.
We are satisfied that the primary judge’s exercise of discretion in respect of costs miscarried in the sense required for appellate intervention (House v The King (1936) 55 CLR 499 at 504-505).
First, the inescapable fact is that the Bloomer parties infringed Tamawood’s copyright. That s 115(3) applied merely protected the Bloomer parties from a claim for damages and rendered them liable only to an account of profits.
Second, that the Bloomer parties had put Tamawood on notice that it had not made any relevant profits does not change the fact that they infringed Tamawood’s copyright. The primary judge declared that such an infringement by the Bloomer parties had occurred on 26 November 2013, albeit that the infringement was identified as “innocent” in the declaration. There is no reasonable basis upon which the obtaining of this declaration can be overlooked as part of the relevant “event” for the purposes of the exercise of any discretion on costs. It is trite that the discretion, while wide, is not unconfined and must be exercised judicially. Failing to give any material weight to the fact that Tamawood succeeded in proving that the Bloomer parties had infringed its copyright involves an error of principle.
Third, the above conclusions are reinforced by the fact that the Bloomer parties put Tamawood to proof on the whole of its case. They did not merely plead that they had the benefit of s 115(3). They did not admit that the works in suit were copyright works. They did not admit that Tamawood owned the copyright in those works. They did not admit any infringement of copyright. The fact that other parties also put Tamawood to proof is not to the point. As between Tamawood and the Bloomer parties, to succeed, Tamawood had to make good its case on all substantive points. Tamawood did so. This too is a necessary relevant consideration to the proper characterisation of the event for the purposes of determining the appropriate order as to costs. To give weight to the success of the Bloomer parties in invoking s 115(3), at the expense of a consideration of these factors, as the primary judge must be inferred to have done from the result, involves an error of principle.
In these circumstances it was not reasonably open to conclude that Tamawood should pay the costs of the Bloomer parties. The reasons given by the primary judge for so concluding, in effect that Tamawood had pursued the Bloomer parties with “little result” (at [8]), misconceives the nature of the proceeding and the outcome in fact reached. Tamawood succeeded in its essential case against the Bloomer parties for infringement of copyright. A declaration was made vindicating Tamawood’s rights in this regard. Bloomer established that it was entitled to the limited protection afforded by s 115(3). It established also that no pecuniary remedy was available because no profits had been made. The fundamental compensatory purpose of costs orders in civil proceedings effectively demanded that the starting point be the usual order for costs be made in favour of Tamawood and against the Bloomer parties. The circumstances identified by the primary judge would have permitted departure from this order, including an exercise of the costs discretion so as to make each party as between Tamawood and the Bloomer parties pay its own costs. Ordering Tamawood to pay the costs of the Bloomer parties, however, was not reasonably open.
It also follows from this that there was no basis upon which, by reason of the letters of offer to settle the proceedings which the Bloomer parties made (in effect, that the parties each pay their own costs and walk away from the proceedings on that basis), orders for indemnity costs could be made. Tamawood should not have been exposed to any orders for costs in favour of the Bloomer parties, let alone orders for indemnity costs for any part of the proceedings.
For these reasons, irrespective of the fact that the primary judge ought to have found infringement of Tamawood’s copyright in the Dunkeld in addition to the Torrington, the costs orders made on 26 November 2013 must be set aside. Tamawood properly acknowledged that it would not be an inappropriate exercise of the costs discretion for each of Tamawood and the Bloomer parties to pay its own costs of the proceeding below. In the circumstances, that is the appropriate order to make.
ISSUE 9 – MISLEADING CONDUCT BY SHANE O’MARA
Shane O’Mara appealed against the primary judge’s conclusion that, as Mondo contended, he had engaged in misleading and deceptive conduct.
The primary judge found that:
·“Mr Sweeney [of Mondo] was insistent, both in his affidavit evidence and in cross examination, that he had specifically asked Mr Speer and Mr O’Mara [of Habitare] about Mondo preparing plans “generally in accordance” with the plans already approved. In cross-examination Mr Speer and Mr O’Mara conceded that Mr Sweeney had raised this issue with them, and that they had assured him that there was no problem” (at [293]).
·“Mondo would never have entered a contract with Habitare to produce drawings for the developments of the Calamvale and Brackenridge sites had Mr Speer and Mr O’Mara, on behalf of Habitare, not assured Mr Sweeney that there were no outstanding issues with Tamawood” (at [295]).
·“…in informing Mr Sweeney on 21 June 2006 that there were no outstanding issues between Habitare and Tamawood concerning the use of the Tamawood drawings, that this was a representation which was misleading and deceptive within the meaning of s 52” (at [297]).
Her Honour was “not persuaded that Mr Speer and Mr Shane O’Mara did not appreciate the misleading nature of the representation they had made to Mr Sweeney on 21 June 2006”. Further, her Honour held that “this claim was based on an optimistic (and baseless) appraisal of the facts existing at that time rather than a realistic assessment of the history of negotiations between Tamawood and Habitare”, there being “no foundation upon which Mr Speer or Mr Shane O’Mara could reach such a conclusion”. Accordingly, Shane O’Mara was “knowingly concerned in the conduct of Habitare within the meaning of s 75B of the Trade Practices Act” (at [298]).
Shane O’Mara submitted that the conclusion of his knowing involvement in Habitare’s misleading and deceptive conduct should be set aside because the primary judge’s reasons for attributing knowledge of the falsity of the representation to Shane O’Mara were perfunctory and detailed reasons were called for given the fact of the lengthy delay between the hearing and the delivery of the principal judgment (by reason of matters, it should be said, wholly outside the control of the primary judge). The following observations from Expectation Pty Ltd v PRD Realty Pty Ltd (2004) 140 FCR 17; [2004] FCAFC 189; were relied on to support this submission:
[71] In the normal course, statements made by a trial judge of a general assertive character can be accepted as encompassing a detailed consideration of the evidence. However, where there is significant delay, such statements should be treated with some reserve. After a significant delay, a more comprehensive statement of the relevant evidence than would normally be required should be provided by the trial judge in order to make manifest, to the parties and the public, that the delay has not affected the decision.
[72] In cases not affected by delay, an appellate court is entitled to assume that the mere failure to refer to evidence does not mean that it has been overlooked or that other forms of error have occurred. However, where there is significant delay, no favourable assumptions can be made. In such circumstances, it is up to the trial judge to put beyond question any suggestion that he or she has lost an understanding of the issues. Where there is significant delay, it is incumbent upon a trial judge to inform the parties of the reasons why the evidence of a particular witness has been rejected. It is necessary for the trial judge to say why he or she prefers the evidence of one witness over the evidence of other witnesses (Hadid v Redpath (2001) 35 MVR 152 at [34] and [53]).
[73] Of course, where the trial judge, notwithstanding significant delay, demonstrates by his or her reasons that full consideration has been given to all of the evidence, the parties and the public may be satisfied that the delay has not affected the decision. More specifically, if the reasons demonstrate that the delay has not weakened the trial judge’s advantage, confidence will be maintained in the decision. For example, it would be open to a trial judge to explain in the course of giving reasons that contemporaneous notes were made of impressions formed as evidence was given by witnesses of importance (see R v Maxwell (unreported, New South Wales Court of Criminal Appeal, Spigelman CJ, Sperling and Hidden JJ, 23 December 1998)).
The circumstances beyond the primary judge’s control did result in a substantial delay between the hearing and the delivery of the principal judgment (some 18 months). However, nothing in the primary judge’s treatment of this issue suggests any failure to consider relevant evidence or lack of understanding of what had to be determined.
As Mondo put it in response, the primary judge was satisfied that Shane O’Mara knew the representation (that there was no problem by reason of Tamawood’s copyright in the Tamawood plans) was false (at [298]). Mondo said this, which should be accepted:
…in the cross examination of Mr O’Mara by Mr Cobden SC, the following appears:
Now, the position, then, in relation to Hamish Street was that the DA came out. You had spoken to Mondo – to Mr Sweeney. Your view was that you couldn’t use the Tamawood plans, and so things needed to put back together again so that you could proceed with the development, did they not? – Yes.
And that was at least a fairly concerning event that you couldn’t use Tamawood. You didn’t have a builder, and you didn’t have plans. That was of some concern to you? – Yes
An understanding by Mr O’Mara that Habitare could not use Tamawood’s plans and therefore did not have plans is irreconcilable with a representation that there were no outstanding issues between Tamawood and Habitare and that everything was resolved with Tamawood so that Habitare could go ahead and use the development approval (which was based on the Tamawood plans).
Insofar as the submissions for Shane O’Mara depended on a challenge to the primary judge’s finding that Mr Sweeney was a witness of credit, the submissions for Mondo in answer may be adopted. Mondo said:
Plainly her Honour’s findings depended upon an assessment of the credibility of the witnesses, given that there were competing accounts of the relevant conversation.
In order to overturn the finding on appeal, the appellant must show that the learned trial judge failed to use or palpably misused her advantage or acted on evidence which was inconsistent with facts incontrovertibly established by the evidence or which was glaringly improbable. (Devries v Australian National Railways Commission (1993) 177 CLR 472 at 479; Fox v Percy (2003) 214 CLR 118).
Mondo’s overall submission in response to Shane O’Mara’s appeal in this respect may also be adopted. The submission was in these terms:
The case of the appellant below was that Mr Speer and Mr O’Mara for Habitare believed that they could not use the Tamawood plans, and told Mr Sweeney that that was the case. The learned trial judge rejected the evidence that they told Mr Sweeney they could not use the Tamawood plans. What remains, and what is avoided in the appellant’s submissions, is the underlying proposition that Mr Speer and Mr O’Mara knew that they could not use the Tamawood plans.
It is unsurprising, given the way in which the case was conducted that the learned primary judge felt able to give brief reasons for the finding that Mr O’Mara was a person knowingly concerned in the making of the representation.
For these reasons grounds 2 to 7 of Shane O’Mara’s appeal should be dismissed.
Conclusions
For the reasons set out above Tamawood’s appeal should be allowed in part (excluding its case that the primary judge erred in finding the Bloomer parties to be within the scope of s 115(3) of the Copyright Act). Mondo’s appeal should be dismissed, as should the appeal of Shane O’Mara.
The parties should confer and submit within 14 days agreed or competing proposed orders reflecting these reasons for judgment, including with respect to costs.
I certify that the preceding one hundred and thirty-two (132) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Jagot and Murphy. Associate:
Dated: 15 May 2015
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